Barclays Has Lowered Expectations for Advanced Drainage Systems (NYSE:WMS) Stock Price

Key Points

• Barclays cut its price target on Advanced Drainage Systems from $191 to $183 but maintained an “overweight” rating; the new target implies about 49% upside from the prior close. Analysts’ consensus rating is “Moderate Buy,” with an average target of $185.60.
• Quarterly results were mixed: EPS of $1.88 beat one consensus estimate of $1.81, while revenue of $889.41 million fell short of expectations and was up 4.6% year over year.
• Reports of reduced company guidance added to investor concerns; WMS shares traded at $122.61, near their 52-week low of $119.53.

Advanced Drainage Systems (NYSE:WMS - Get Free Report) had its target price decreased by equities researchers at Barclays from $191.00 to $183.00 in a research note issued to investors on Friday, Benzinga reports. The brokerage currently has an "overweight" rating on the construction company's stock. Barclays's price objective would indicate a potential upside of 49.25% from the stock's previous close.

Other analysts have also issued reports about the company. Royal Bank Of Canada lowered their target price on Advanced Drainage Systems from $178.00 to $170.00 and set an "outperform" rating on the stock in a research note on Wednesday, October 14th. Zacks Research upgraded Advanced Drainage Systems from a "strong sell" rating to a "hold" rating in a research note on Monday, July 27th. DA Davidson set a $180.00 price objective on Advanced Drainage Systems in a report on Friday. Robert W. Baird set a $206.00 price objective on Advanced Drainage Systems in a research note on Friday, August 7th. Finally, National Bank Financial set a $190.00 price objective on shares of Advanced Drainage Systems in a report on Monday, August 24th. Eight equities research analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company. According to data from MarketBeat, the company presently has an average rating of "Moderate Buy" and a consensus price target of $185.60.

Advanced Drainage Systems Stock Performance

Shares of Advanced Drainage Systems stock traded down $0.01 on Friday, reaching $122.61. 251,928 shares of the company traded hands, compared to its average volume of 822,174. Advanced Drainage Systems has a 52 week low of $119.53 and a 52 week high of $179.32. The company has a 50 day moving average of $130.34 and a 200 day moving average of $143.25. The firm has a market capitalization of $9.25 billion, a PE ratio of 21.20, a PEG ratio of 1.65 and a beta of 1.30. The company has a debt-to-equity ratio of 0.95, a current ratio of 2.12 and a quick ratio of 1.18.

Advanced Drainage Systems (NYSE:WMS - Get Free Report) last posted its quarterly earnings results on Thursday, November 5th. The construction company reported $1.88 EPS for the quarter, topping analysts' consensus estimates of $1.81 by $0.07. Advanced Drainage Systems had a net margin of 14.00% and a return on equity of 28.28%. The company had revenue of $889.41 million for the quarter, compared to analysts' expectations of $921.79 million. During the same quarter in the previous year, the firm posted $1.97 EPS. Advanced Drainage Systems's revenue was up 4.6% on a year-over-year basis. Equities analysts forecast that Advanced Drainage Systems will post 6.57 earnings per share for the current year.

Institutional Inflows and Outflows

A number of hedge funds have recently added to or reduced their stakes in WMS. Chicago Partners Investment Group LLC grew its stake in Advanced Drainage Systems by 3.6% in the third quarter. Chicago Partners Investment Group LLC now owns 2,361 shares of the construction company's stock worth $308,000 after purchasing an additional 83 shares during the period. First Bank & Trust raised its holdings in Advanced Drainage Systems by 5.5% in the third quarter. First Bank & Trust now owns 1,666 shares of the construction company's stock worth $211,000 after purchasing an additional 87 shares in the last quarter. North Dakota State Investment Board lifted its position in Advanced Drainage Systems by 5.4% during the third quarter. North Dakota State Investment Board now owns 2,215 shares of the construction company's stock valued at $281,000 after buying an additional 114 shares during the period. RWC Asset Management LLP lifted its position in Advanced Drainage Systems by 3.4% during the third quarter. RWC Asset Management LLP now owns 3,727 shares of the construction company's stock valued at $472,000 after buying an additional 124 shares during the period. Finally, Kestra Private Wealth Services LLC boosted its holdings in shares of Advanced Drainage Systems by 3.6% during the 3rd quarter. Kestra Private Wealth Services LLC now owns 3,532 shares of the construction company's stock valued at $448,000 after buying an additional 124 shares in the last quarter. Hedge funds and other institutional investors own 89.83% of the company's stock.

Key Stories Impacting Advanced Drainage Systems

Here are the key news stories impacting Advanced Drainage Systems this week:

• Positive Sentiment: ADS declared a quarterly dividend of $0.20 per share, payable December 15 to shareholders of record December 1. That equates to $0.80 annually and a yield of about 0.6%. Dividend details
• Positive Sentiment: Quarterly EPS of $1.88 topped the $1.81 consensus estimate cited in one report, and revenue rose 4.6% year over year. Quarterly earnings results
• Negative Sentiment: Revenue of $889.41 million missed the $921.79 million estimate, while EPS fell from $1.97 a year earlier. Other coverage cited an EPS consensus of $1.89, meaning the $1.88 result also missed that benchmark. Revenue miss and stock reaction
• Negative Sentiment: Reports said the company cut its guidance, adding to investor concerns about its outlook. The earnings disappointments and guidance reduction were cited as reasons WMS shares fell sharply. Results and guidance coverage

Advanced Drainage Systems Company Profile

Advanced Drainage Systems, Inc NYSE: WMS is a manufacturer of water management products and solutions. The company produces thermoplastic corrugated pipe, fittings, drainage structures, stormwater chambers and related products used to manage the collection, conveyance, storage and treatment of water.

Its products serve a range of markets, including residential, commercial, agricultural, infrastructure and environmental applications. Advanced Drainage Systems supplies solutions for stormwater management, septic and wastewater systems, highway and road construction, land development, agriculture and erosion control.

Founded in 1966 and headquartered in Hilliard, Ohio, the company serves customers through a manufacturing and distribution network primarily covering the United States and Canada, with additional international operations.

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